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Actuaries analyze high-risk reimbursement proposals

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Analysts at the American Academy of Actuaries seem to prefer the idea of reimbursing health plans more for covering expensive patients over two other commonly discussed ideas for replacing current commercial health insurance market rules.

Related: Math geniuses size up 5 ACA change ideas

Analysts at the Washington-based group talk about the health system change ideas in a new set of three issue briefs.

Actuaries are people who have taken tests to show that they understand the math used to develop, price and set reserves for insurance products.

President Donald Trump and many Republicans in Congress have said that they want to repeal the Affordable Care Act rules and programs that now affect the commercial health insurance market and replace them with something better.

The academy actuaries looked at the idea of trying to improve the markets for individual and small-group health coverage by letting insurers sell coverage across state lines, the idea of letting employers set up association health plans they could use to buy coverage, and the idea of creating new arrangements for covering people who are at a high-risk of filing expensive medical claims.

Letting insurers sell coverage across state lines could kill the insurers required to offer richer health benefits, and it could eventually limit older, sicker consumers’ access to health coverage, the analysts write.

Association health plans would probably have trouble getting better health care bargains than health insurers get, and managers of single-state employer group purchasing coalitions have always had trouble keeping the coalitions solvent, the analysts write.

Related: Failed health plan had $2,400 in unpaid claims per enrollee

The analysts looked at three ideas for helping insurers cover high-risk enrollees:

      • Separate high-risk pools, or subsidized insurance plans, for people with health problems.

      • Paying extra cash to insurers with enrollees who have big claims.

      • Paying extra cash to insurers who have enrollees with expensive health problems.

The analysts point out that consumers would know if they were in special risk pool plans, might feel bad about the coverage, and might not get the same level of care coordination they would get in a good private plan.

A risk pool program might also force the enrollees to pay more for coverage, offer them fewer choices than private plan enrollees get, and expose them to the risk of fluctuations in outside risk pool program support, the analysts say.

The two risk reimbursement proposals might be less visible to the high-risk enrollees, offer the high-risk enrollees better benefits and care management services, and be easier to administer, the analysts write.


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